Diabetic nephropathy, a major complication of diabetes, is the leading cause of end-stage renal disease worldwide. Hyperglycemia induces organ injury through complex pathways including the formation of advanced glycation end products (AGEs), activation of Nox4-dependent generation of reactive oxygen species (ROS), and mitochondrial dysfunction. Preliminary and published data generated in our laboratory demonstrate a novel localization of Nox4 to the mitochondria and enhanced NAD(P)H- dependent ROS generation within this compartment when cultured renal cells are exposed to high glucose (HG) or AGEs as well as in the renal cortex and glomeruli of rats with type 1 diabetes. Histologically, diabetic nephropathy is characterized as an excessive accumulation of extracellular matrix proteins (Fibronectin and Collagens). Accumulation of matrix proteins is a result of increased protein synthesis and decreased protein degradation. High glucose induces protein synthesis through activation of the mTOR signaling pathway and inhibits protein degradation by inducing inhibitors of matrix-degrading enzymes such as plasminogen activator inhibitor-1 (PAI-I). Our preliminary findings and published data demonstrate that HG- and AGE-dependent activation of mTOR is redox-sensitive. Recent evidence indicates the transcription factor, hypoxia inducible factor (HIF)-1 alpha, and its target gene PAI-1, are upregulated in glomeruli of diabetic animal models. Indeed, our preliminary data show that HIF-1alpha is up-regulated in MCs exposed to HG or AGEs and mediates FN accumulation. Importantly, we show a potential mechanism by which redox-activation of mTOR mediates HIF-1alpha accumulation. Mitochondrial dysfunction, with reduced ATP levels and reduced oxygen consumption, has been detected in cells and tissues of diabetic patients and animal models of diabetes. Our preliminary data indicate that HG-mediated reduction of cellular ATP levels is associated with increased NADPH oxidase activity. Moreover, we find that Nox4 harbors an ATP-binding cassette in its C-terminal sequence and that ATP inhibits NADPH-dependent superoxide generation in MC homogenates. Together, these results suggest the existence of a novel mechanism by which the decrease in ATP and changes in energy homeostasis in HG regulate mitochondrial Nox4 activity. Reduced expression of mitochondrial genes involved in mitochondrial biogenesis is associated with altered cellular metabolism and oxygen consumption. In support of this, we find Ying Yang1 (YY1), a transcriptional regulator of mitochondrial biogenesis is downregulated in MCs exposed to HG, providing a potential mechanism by which energy homeostasis is altered. Taken together, we will identify the mechanisms by which high glucose and advanced glycation end products reduce intracellular ATP levels and activate mitochondrial Nox4-dependent oxygen radicals with subsequent stabilization of hypoxia-inducible factor-1 alpha and extracellular matrix accumulation in renal glomeruli, in vitro and in experimental animal models in vivo. Cutting edge techniques will be applied to elucidate these mechanisms and will provide novel insights into the pathogenesis of diabetic nephropathy. Identifying the biophysical properties of Nox4 sensitive to ATP will allow specific small molecule targeting without interfering with vital respiratory functions of mitochondria. This work may have major therapeutic implications.